June 4, 1999

Accra, Ghana (PANA) - Germany has approved 90 million Marks for the funding of projects in Ghana in fiscal 1999/2000.

Under the agreement signed at the end of the Ghana-Germany bilateral negotiations in Accra Thursday, 40 million Marks is to be provided as a concessional loan with an interest rate of 0.75 percent per annum and a repayable period of 40 years, with 10 years grace period. The remaining 50 million marks is a grant.

The agreement was signed by Ghana's Minister of Fiannce, Kwame Peprah and Christian Potyka, Director for Economic Co-operation (West Africa) in the German Ministry of Economic Co-operation and Development.

The money would be used for the decentralisation programme, rehabilitation of water supply systems in the Eastern and Volta Regions, promotion of small and micro enterprises, the road and transport sector and support for rural financial systems.

Under the negotiations, the single largest project agreed upon is the rehabilitation of the Tema-Sogakope-Aflao road that would link Ghana to Togo.

Together with earlier commitments, Germany would contribute a total of 76 million Marks for this project.

The private sector would receive 10.5 million Marks that would assist micro enterprises in the Kumasi and Accra areas.

Also to benefit are institutions such as Ghana Chamber of Commerce, Ghana Investment Promotion Centre and the Ghana-German Business and Economic Associations.

In a speech, Peprah called on Ghana's partners to help support its concrete economic strides following the fall in world cocoa and gold prices, while the prices of crude oil and oil products rise.

He said Ghana would require help to enable it to face the shocks from the temporary setbacks in revenue that would occur.

"In this regard we hope that we can count on the help and support of Germany and other economic partners if the situation persists longer than we expect," he added.

Potyka said the gloomy picture of Africa shows that the continent is in urgent need of international solidarity and partnership.

He said news from Africa is depressing due to civil wars and military conflicts that are drawing in neighbouring countries.

Potyka decried the situation where the continent is ignored when it comes to capital transfers and private investments.

He, therefore, called for a "different view of our continental neighbour (Africa), seeing the varying, sometimes contradictory, developments."